The Economics of Open Source Donations

Donations play a crucial role in supporting Free and Open Source Software projects. At times readers will write in to share their positive experience with a utility or program or a distribution that I have written about. Now don't confuse them with your average technical-bent-of-mind Linux user. These are accountants, home-office businessman, and even carpenters and plumbers, who've saved a lot of money thanks to open source software. And they have one question in mind -- how do I help the person behind the program?

I generally recommend everyone to find the project's forum boards, or IRC channel, or mailing list and try and help other new users. Some do, and eventually even graduate to write documentation, like simple installation steps or how to install dependencies, in forum board posts. But some readers are incapable of even that kind of help. After my interview with Sebastian Trüg of K3b, a reader wrote in surprised that the software he had been using for writing MP3s for his grandchildren, ever since his grandson installed Kubuntu on his box, was written by a college student. He wanted to help, but didn't know how. K3b just worked for him. His demands from the distribution were minimal and so was his technical understanding.

Recommending such people (and in fact others too) to donate to their favorite projects, isn't a bad idea. In fact I point them to Ladislav Bodnar's DistroWatch donations program to get a feel for the idea. I am not sure how many people take my advice seriously and do actually donate, but a couple of them wrote back after my interview with Bodnar, where he expressed surprise about the lack of response or even a courteous "thank you" from big projects after receiving donations. "What do they use the money for", they all wanted to know. Some suggested themselves that it's because "they are such big groups, and they all have jobs."

So why are donations important?

Since it seems to bother so many people, I thought I'd ask someone in the know. Fabio Erculiani, lead-developer of the two-man development team that churns out the popular Gentoo-based Sabayon Linux lists some common expenses of running a FOSS project. "We have hosting bills," explains Erculiani who has passed on a job offer by Google to complete his studies, "backup systems such as NASs, RAID arrays (hard drives tend to break often here... I had two breakages in around 6 months), new hardware, especially video cards, processors, wifi cards (usb, pcmcia, pci). We also bought a Mac Mini with a fundraiser at the end of 2006. I think that the most important thing, at our stage, is to keep a good and tested support. We also need to finance the development. This means two things: first, paying the electricity to run 2-3 servers 24/7/365 and secondly, spend time on long term projects, like Entropy, our upcoming new binary package manager."

That's quite a list. "I think donations are important for projects that are done by developers in their spare time like I did the first 8 years of K3b," agrees Sebastian Trüg, lead-developer at K3b, the popular CD/DVD burning app. Trüg now works full time on free software, sponsored by Mandriva and spends about 30% of his time working on K3b.

If you think donations aren't important for big projects whose developers have regular jobs, think again. "Donations are critical to the CentOS Project," comments Johnny Hughes, one of CentOS's 14 volunteer developers that develop this enterprise-class distribution. "Money is required to allow developers to attend FOSS events outside their area. Money and hardware donations are also required for development machines to build CentOS and for a network to distribute CentOS. We have been much more successful at obtaining hardware donations than at obtaining monetary donations, but both are important."

But for Samuel Baggen, who works full-time on his popular Elive Live CD, donations are not just important, they are essential. "The donations received are required," explains Baggen, "so I can work on Elive full time without needing a regular job. With enough donations I can spend all my time on Elive, support the community and respond and work on their feedback." With enough donations Baggen hopes to start paying for serious services for Elive like professional designers, coders, etc.

Encouraging users to donate

Since it's such a critical component to their existence, many projects take great measures to get users to donate. Donations to the GIMP project for example are tax exempt in the US. Many projects also throw in a little extra for their donating users. Erculiani offers Sabayon branded goodies and is thinking of offering a premium membership where users will be able to get extra stuff like dedicated mirrors and discounted prices in the e-shop. "Last year we bought two new Dual Core processors," he says, "and this year I have finally updated my server with a new CPU, mainboard, RAM and two hard drives. We have also paid the hosting service and even gave some money to other projects."

Hughes though doesn't like the idea of providing faster mirrors, goodies, or anything else extra about their distribution to people who donate. "As we believe strongly in free software," underlines Hughes, "we want CentOS to be available to everyone, and hope that they will use it and then donate." But CentOS does provide hardware donors with free advertising on their website and in the future will be offering some paid support for users that want that service.

Trüg has only asked for donations once. "I hope that users will get the idea themselves :)." He also believes that since he offers no extra goodies, users will only donate out of good will. When he had that fund raiser for new hardware, Trüg overshot his goal by 500%. Currently, you can buy the official K3b Handbook which is so far only in German but an English translation will be available soon.

Baggen on the other hand has tried a more "adventurous" strategy to get users to donate and was even criticized by some users. He made donations mandatory to download stable releases of Elive. "There are many users," shares Baggen, "who only donate $0.01 but I don't worry about that too much because the users who are satisfied with Elive and support a better future for Elive will bring more cool people into the Elive world. The donation for download system is sufficient enough to maintain the future of the project. More donations though will mean more features and a brighter future. We will be looking into fun ways to raise money in the future." Baggen has recently started offering paid bonus-disks that allow users to install popular software with the click of a button.

But what really triggers donations?

Are goodies motivating enough to donate? I am skeptical. Without blowing my own trumpet, I wonder if that K3b user would have donated (if he ever did) if I hadn't interviewed Trüg. Hughes agrees there is a connection between a project's popularity, the press coverage it receives and its user base. "How a project gets that press," he explains, "is obviously to provide a quality product that people need and are willing to write and talk about."

Contests and awards, according to Hughes, provide another avenue for getting press coverage and expanding the user base. "Since only a small percentage of users actually donate, the bigger your user base, the larger the donation group."

That might work for a big project like a complete distribution but for an application like K3b, a broad user-base doesn't guarantee donations. Trüg nails this perfectly. "The way I experienced it," he shares, "there is a phase in which the project becomes popular, that is, when people discover it as a better alternative. That is when they donate the most. Now, K3b comes with every distribution and is the default burning application which means there is no more "discovering of a new project". The result is that the donations are less frequent."

Final thoughts

Donations are important to FOSS projects, big and small. Some projects go out of their way to ensure donating users get more in return than the satisfaction of helping their favorite project. While it would seem a project's popularity and a sizable user-base would ensure monetary support, as applications become more reliable and just work out of the box, they might adversely affect a project's chances of receiving donations.

But one thing's certain. Irrespective of whether you decide to donate or not, the developer or developers behind the project will continue hacking. Spirit, after all, cannot be donated.

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